In addition, the court found that Murdock had a history of reprisal against board members who did not support his plans, including leaving threatening voice mails and demanding that at least one board member resign. The court also held that Carter interfered with the committee’s efforts to manage the process and negotiate with Murdock by taking steps to undermine the arm’s length negotiation process.Īs to Murdock, the court highlighted that he had long been seeking to take Dole private and, among other things, used Dole’s financial advisor at the time to investigate that plan.
#KINGDOM TALES MFW FULL#
The court found that, prior to the process leading to the sale, Carter made false disclosures that did not identify the full extent of planned cost savings and unilaterally canceled a board-approved share repurchase program, which “primed the market for the freeze-out by driving down Dole’s stock price and undermining its validity as a measure of value.” Moreover, the court found that during the process, Carter “used his control over Dole’s management to provide false information to the Committee,” including knowingly false “lowball” projections, while providing Murdock’s bankers with more positive projections.
The court’s decision was driven by specific factual findings of improper conduct by Murdock and Carter. He and his right-hand man, Carter, sought to undermine the Committee from the start, and they continued their efforts throughout the process.” However, the court instead applied the rigorous entire fairness standard of review to the transaction, finding that “espite mimicking MFW’s form, Murdock did not adhere to its substance. 2013) - namely, conditioned upon approval of a special committee of Dole directors and a majority of the minority vote of Dole stockholders - which would be expected to result in application of the business judgment rule as the standard of review applied by the court. The transaction was structured pursuant to the formula described in In re MFW S’holders Litig., 88 A.3d 635 (Del.
Michael Carter (Dole's president, chief operating officer and general counsel) were jointly and severally liable for more than $148 million in damages for breaches of fiduciary duty. The court found that David Murdock (the 40 percent stockholder and de facto controller of Dole Food Company, Inc. The court found that this take-private transaction by its controlling stockholder was the result of unfair dealing, despite the company having implemented procedural protections recommended by the Delaware Supreme Court in In re MFW S’holders Litig. & In re Appraisal of Dole Food Co., Inc., C.A. Travis Laster of the Delaware Court of Chancery issued a post-trial opinion that includes many important takeaways for practitioners, board members, members of management and their advisors. Earlier this year, in a consolidated breach of fiduciary duty and appraisal action, Vice Chancellor J.
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